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Vietnam's commitment to investors in doubt after riots - China Daily

SHANGHAI (Reuters) - Anti-Chinese riots in Vietnam last week have raised doubts about its commitment to foreign investment, the state-run China Daily newspaper said on Monday, as China reported it had evacuated about 4,000 people from its southern neighbour.

A flare-up over disputed sovereignty in the South China Sea sparked protests in Vietnam that spiralled into a rampage of arson, destruction and looting of Chinese-owned factories, and other businesses mistaken for being Chinese.

Fighting between Vietnamese and Chinese workers broke out in central Ha Tinh province on Wednesday killing two people and wounding 140, Vietnam said. China's foreign ministry also put the casualties at two dead and 100 injured, Xinhua said.

A doctor and a witness, however, said they saw between 13 and 21 dead bodies, most of them Chinese, on the night of the unrest.

"The severity of the violence and the heavy losses foreign firms have suffered raises the question of whether the Vietnamese government attaches enough importance to the interests of investors and the security of foreign factories," the English-language newspaper said in an editorial.

China's foreign ministry said about 4,000 Chinese workers had left Vietnam as of Monday.

Fury gripped Vietnam after Chinese state energy firm CNOOC deployed dozens of ships two weeks ago and towed a $1 billion oil rig to a spot 240 km (150 miles) off Vietnam's coast in an area both counties claim.

ATMOSPHERE "DESTROYED"

The conflict over sovereignty in the South China Sea was not likely to end soon nor was anti-China sentiment "among radical Vietnamese people", the China Daily said.

"It is not the protests per se that are the major concern of investors and their governments. It is the inability of the Vietnamese central government and its local counterparts to bring the protests under control," the newspaper said.

The compensation could come in the form of tax waivers, tax cuts, concessional loans or debt relief on overdue loans, Taiwan's Taipei Times said in a report.

China's 21st Century Business Herald said the violence would hurt China-Vietnam links.

"The riots against foreign companies in Vietnam will have a great impact on trade and economic ties between Vietnam and China," it said.

Chinese Foreign Ministry spokesman Hong Lei said on Sunday the violence "destroyed the atmosphere and conditions for bilateral communication and cooperation".

Vietnamese police made several arrests in the capital, Hanoi, and commercial hub of Ho Chi Minh City on Sunday within minutes of groups trying to start protests, according to witnesses, as Vietnam's communist rulers stuck to a vow to thwart any repeat of last week's violence in three provinces in the south and centre.

"To stay or not to stay is now the question for those who already have factories in the Southeast Asian country after their factories were looted and burned down by protesters late last week," the China Daily said.

(Additional reporting by Michael Gold in Taipei; Editing by Robert Birsel)